4 Tips to Overcoming Inflation

Inflation is a hot topic in today's economy, and most Americans feel its impact. Whether buying groceries, booking travel, or buying gas, you've undoubtedly recognized the substantial increase in how much your essentials cost. See how you can fight this.

Looking into the Numbers
4 Key Steps to Overcoming Inflation
Navigating Financial Uncertainty

Looking into the Numbers

In March 2022, consumers paid an average of 6% more for goods and services. Between August 2022 and August 2023, many items saw double-digit price hikes. For instance, a bottle of salad dressing jumped from $3.99 to $4.47, and an 8oz. sirloin steak rose from $8.99 to $9.90.

Though small, these increases can add up to $200 in extra monthly expenses for the average consumer.

There are ways to lessen the repercussions of inflation by considering the following inflation-fighting tips.

4 Key Steps to Overcoming Inflation

1. The Power of Budgeting

Budgeting is crucial in identifying where excess costs are creeping in. Whether you're new to budgeting or already have a system in place, tracking your spending can reveal significant financial impacts and help you adjust accordingly. Here are some tips:

Regularly review your budget, especially if you notice a consistent increase in spending
Shop at lower-priced stores or use comparison pricing to get the best deals
Cut out non-essential costs to keep your budget in check

2. Knock Out High-Interest Debt

The more you can spend on paying off high-interest debt, the better. While it may seem silly to suggest you spend more in a time where you likely have less, getting ahead of your debt can put more money back in your pocket in the long run. Paying off high-interest debt, such as credit cards and personal loans, can free up more money in the long run.

Consider a debt consolidation loan or a 0% balance transfer credit card to reduce your payments and interest charges. While you need good to excellent credit to be considered for this type of consolidation, those who qualify can typically lower their payments significantly and spend less on interest charges. Consider taking our financial fitness assessment to get help from a banker, linked here.

3. Plan for Financial Stability

You're more likely to overspend when you find yourself in a pinch. To avoid being caught unprepared, consider taking some time to plan your week. Here are a few tips:

Plan your weekly meals over the weekend before grocery shopping. Utilize store ads to determine what will be on sale, and use this to determine what you’ll buy to make your dollar stretch further
If you travel, consider packing some pre-packaged snacks or meals to avoid expensive airport or roadside prices
Looking to make a large purchase? Avoid putting this on a credit card or depleting your savings by planning to set aside a small amount of money from each paycheck until you have enough to make the purchase

When unexpected expenses you can’t plan for arise, such as needing car repairs or purchasing a new washing machine, don’t panic! Take a moment to assess your financial situation and make a plan. Taking advantage of a 0% interest financing offer could be beneficial if you are confident you can pay the balance off before the end of the promotional period. If you decide to use money from your savings account, consider planning to repay yourself the money used over a few months.

4. Maximize Your Savings with High-Yield Accounts

Unfortunately, if your money is not in a savings account that earns you interest, inflation is causing you to lose money. Moving your money to a high-yield savings account (HYSA) will reap a higher rate of return than the average account, allowing your money to work for you over time. Depending on your balance, returns can be quite fruitful. HYSA is best for short- to medium-term savings and is the ideal place to store your emergency fund. Your banker is an excellent resource in determining the HYSA that is best for you.

Navigating Financial Uncertainty

Inflation has undoubtedly caused millions of Americans to reassess their financial situation. However, getting ahead of it is key. Implement necessary changes to your budget and lifestyle early, and modify this as needed to ensure that your financial plan remains intact, even through the most uncertain economic times.